Bitunix Analyst: Inflation Pressure Extends Into 2027 — Bond Long Trades Face a Policy Test

October 28 — The global economy is now facing a dual condition of growth resilience and inflation stickiness. A Reuters survey across 50 economies shows that 31 raised their 2027 inflation forecasts, while 23 raised their growth forecasts. Rising energy prices and ongoing AI investment have kept demand from cooling significantly, yet price pressure may continue to spread. International oil prices have held above $100 per barrel since early October — and if the energy shock transmits further into transport, production, and services prices, it will become even harder for major central banks to balance inflation control against growth.

Changes in energy supply are also rewriting trade costs. Indian refineries are now increasing their purchases of Middle East crude, as the Russian crude discount is gradually being offset by rising shipping costs. BPCL expects to reduce Russian crude imports in November and pivot to Middle East supply, whose landed costs have become more competitive. This reflects that what markets are truly weighing is no longer just oil prices or nominal discounts — it is shipping risk, capacity, and delivery costs. Even though the US and Russia have begun discussing partial post-conflict energy cooperation, any such plans remain conditional on the conflict ending — meaning they cannot translate into incremental supply in the near term.

The Fed is widely expected to hold rates this week, but market divergence over the subsequent policy path is deepening. Energy pushing inflation higher may support a longer period of tightening. On the other side, the recent Treasury rebound and investors adding bullish positions reflect that some capital is already hedging against economic cooling. Should Warsh deliver a more hawkish signal, bond longs could face unwinds. Should policy remain on hold, markets would need to reassess whether inflation has truly peaked.

What matters next is whether energy costs can retreat, whether price pressure spreads into core inflation, and how the Fed responds to the tug-of-war between growth and prices. As supply risk persists and economic demand remains resilient, what markets face is not just short-term oil volatility — it is a linked repricing of inflation expectations, funding costs, and asset valuations.